SGLV Sgl Vietnam

RNS Number:6527S
SGL Vietnam Development Limited
18 April 2008



18 April 2008


SGL Vietnam Development Limited ("SGL", or the "Company")


Principle agreement for investment in Ho Chi Minh City


SGL Vietnam Development Limited (AIM:SGLV), a company established to engage in
property investment and development primarily in Vietnam, is pleased to announce
that it has signed a principle agreement (the "Principle Agreement") with a
local partner, T&S Co., Ltd. (the "JV Partner"), to procure land in the Binh
Thanh district of Ho Chi Minh City ("HCMC") for the development of residential
and commercial property. Under the terms of the Principle Agreement, the Company
will have a 90% equity share in the JV company to be incorporated to develop the
project.


The Directors expect that the total gross development cost for the project will
eventually be approximately US$40 million, funded c.45 per cent. through equity
and c.55 per cent. through other sources including pre-sales and debt. The
project will be financed through phased payments according to a schedule of
development milestones and the Company intends to set up an escrow facility to
facilitate this.


The JV Partner has commenced the process of site clearance and will submit
application for planning approval within the next two to three months, by which
time the Company expects to have entered into a formal joint venture agreement
with the JV partner. The Company is targeting to secure the construction permit
and initiate pre-launch sales in 1H 2009. While the Company and the JV Partner
are confident of securing all relevant approvals and permissions to redevelop
the site, there is no guarantee that all relevant approvals and permissions can
be secured.  The Company will pay a $200,000 non refundable deposit in order to
secure this opportunity, however should the JV Partner be unable to obtain
planning approval, the deposit, together with a penalty, will be refunded to the
Company.



The development will comprise one block of freehold residential apartments and
commercial space, located in Ung Van Khiem St, Binh Thanh District, 4 km from
HCMC's downtown central business district and 6 km from the Tan San Nhat
international airport, with close local transport links. This high class
development will be targeted at high income local and overseas Vietnamese. The
development is in close proximity to numerous high end residential apartments
such as Saigon Pearl, The Manor and Cantavil.



Susan Sim, Director of the Company, said "This investment is in line with our
strategy of investing in niche and high yield developments that are clearly
differentiated in terms of location, value proposition and sustainability of
future demand".





Enquiries:



SGL Vietnam Development Limited
Susan Sim                                  +84 907359 259


Collins Stewart
Adrian Hadden, Stewart Wallace            +44 (0)20 7523 8350



Background



Vietnam*, with a population of over 85 million, is the second fastest growing
economy in Asia, behind only China, with a GDP growth rate of approximately 8.2%
in 2006 and with GDP per capita, measured in 1994 prices, increasing by over 43%
from 2000 to 2006.

*Asian Development Bank www.adb.org



Vietnam's sound fundamentals have established a sustained track record of
economic growth in excess of 7% over the last 5 years. Following Vietnam's
accession to the World Trade Organisation, the Asian Development Bank expects
this robust economic growth to continue and has forecast GDP growth of 8% in
2008. Property consultant CBRE VN believes that the expansion of development
activity in Vietnam is being driven by the strongly performing economy, a
growing population and a government eager to move to a free market.



SGL has developed strong relations in Vietnam itself and has relevant real
estate and Vietnam experience. It has significant local knowledge through its
advisors. For example, the Company has appointed The Construction Joint Stock
Company No. 1 ('COFICO' or the 'Development Adviser'), a state-controlled
enterprise and one of the largest construction companies in southern Vietnam, as
its development adviser to provide assistance and advisory services on property
development opportunities including research, consultancy and project
management.



SGL Capital, the Company's investment manager, is led by Mr. Ching Wah
('George') Goh, (Chairman) Mr. Kok Cheong ('Larry') Chua, (Deputy Chairman) and
Ms. Susan Sim, (Chief Executive Officer). They have extensive experience in the
international real estate sector in a variety of countries including Vietnam,
Singapore, China, Indonesia and the United Kingdom. Relevant property experience
includes Binh Duong (180,000 sq. m. retail/office/residential development in
Vietnam), Westlake Hotel (the first 5 star hotel in Hanoi), London Point West
(47,000 sq. m. residential/commercial development in South Kensington, London),
the Suria KLCC Mall in the Petronas Towers (Malaysia) and other significant
properties.



SGL Capital's role is to manage the Company's property portfolio, source and
recommend new investment opportunities, provide project management and exit
strategies.



The Company is also supported by an Advisory Panel including Mr. Marc Townsend,
the Managing Director of CB Richard Ellis (Vietnam) Ltd., one of the key
integrated real estate service providers in Vietnam, and Professor Cao Cu Boi,
who has extensive Vietnamese experience from his previous involvement in various
state and private sector initiatives.




                      This information is provided by RNS
            The company news service from the London Stock Exchange
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